It's indeed one of the most stupid decisions a management could make.

People will be more tired once they arrive in the office. From a companies perspective skilled people will just leave to another company. And you can't hire the best people from everywhere if you need to have an office present. And obviously there are a lot more drawbacks.

From a society perspective it contributes to traffic jams, it contributes to overfilled public transport, and it puts needless stress on infrastructure. In general, it's just not efficient at all.

Sadly many big corporations are lead by narcissists who care more about their ego, who need to feel like they can control other people, rather than their well being or having a positive impact. Some may use it to get rid of people, but that, truly has to be the most stupid way to get rid of your best employees.